Risks Ahead for Jindalee’s US Lithium Ambitions Amid SPAC Uncertainties

McDermitt Project – A Long-Life Lithium Asset

Jindalee Lithium Limited continues to advance its 100% owned McDermitt Lithium Project, strategically located on the Oregon-Nevada border. The project boasts a robust 63-year life with a planned production of 1.8 million tonnes of lithium carbonate, according to the November 2024 Pre-Feasibility Study (PFS). With competitive operating costs and a five-year payback period, McDermitt stands out as one of the largest lithium deposits in the United States and globally significant.

Beyond lithium, Jindalee is exploring the potential to extract magnesium, a critical mineral with growing strategic importance in the US, especially given recent supply chain vulnerabilities. Metallurgical tests indicate high recoveries for both lithium and magnesium, suggesting McDermitt could evolve into a dual-product operation, enhancing its economic and sustainability profile.

Innovative Partnerships and Technology Exploration

In July 2025, Jindalee signed a Memorandum of Understanding with US-based LiChem Operations to trial a patented refining process aimed at producing battery-grade lithium from fine-grained sedimentary ores. This collaboration could potentially replace the sulphuric acid flowsheet outlined in the PFS, reducing costs and environmental impacts while recovering valuable by-products. Jindalee has already shipped ore samples for testing, with further shipments planned pending successful results.

Capital Raising and US Market Listing Strategy

Jindalee is actively positioning McDermitt for development financing through a proposed merger with a US Special Purpose Acquisition Company (SPAC), Constellation Acquisition Corp. I. This non-binding Letter of Intent values Jindalee’s US assets at approximately US$500 million and includes a planned capital raise of US$20-30 million. The transaction aims to list McDermitt on a US national securities exchange, providing direct exposure to US investors and aligning with strong government support for domestic critical minerals projects.

Complementing this, Jindalee completed an $8 million placement to Australian and international investors and is offering a Share Purchase Plan to existing shareholders. Additionally, a non-binding term sheet with L1 Capital proposes an equity line of credit of up to US$100 million, contingent on the SPAC transaction’s completion, providing further financial flexibility.

Regulatory Progress and Government Backing

Permitting efforts for McDermitt continue to advance, with the US Bureau of Land Management expected to issue a Decision Record by the end of 2025. The project benefits from designation as a FAST-41 Transparency Project under US federal initiatives aimed at expediting critical mineral developments. Moreover, recent US legislation allocates billions in funding and loan authority to critical minerals projects, positioning McDermitt to potentially access government grants and co-funding for feasibility studies and development.

Jindalee’s engagement with US government agencies underscores the strategic importance of McDermitt in securing domestic supply chains for lithium and magnesium, minerals essential for electric vehicles, renewable energy, and defense applications.

Broader Industry Context and Corporate Developments

Global electric vehicle sales continue to surge, with 14.7 million units sold year-to-date in 2025, driving strong demand for lithium. Meanwhile, supply chain risks have intensified following China’s imposition of export controls on lithium battery materials. Against this backdrop, Jindalee’s US-focused lithium assets gain added strategic relevance.

On the corporate front, Jindalee appointed Tristan Garthe as Chief Financial Officer, bringing extensive experience in mining finance and capital markets. The company also maintains exploration interests in Nevada’s Clayton North Project and a 20% stake in the Sherlock Project in Western Australia, although McDermitt remains the flagship asset.